Methodology & Data Sources

Data Source

All data on PlainFranchise comes from publicly available Franchise Disclosure Documents (FDDs). Under the FTC Franchise Rule (16 CFR Part 436), franchisors are legally required to provide prospective franchisees with a current FDD at least 14 days before any sale or payment. The FDD is a standardized document containing 23 specific items of disclosure prescribed by the FTC, covering everything from the franchisor's business history to financial performance data. Many states — including California, New York, Illinois, and Minnesota — also require FDD registration with state securities or business regulators, making these filings accessible as public records through state registrar websites. The U.S. Small Business Administration also maintains the SBA Franchise Directory to vet franchise systems for SBA-backed loan eligibility.

Coverage

PlainFranchise covers 223 franchise brands across 15 business sectors, from food and beverage to home services, fitness, education, and business services. Brands are selected based on market presence, availability of current FDD filings, and relevance to prospective franchisees researching investment opportunities. The database is expanded as new FDD filings are collected.

Data Extracted from FDDs

PlainFranchise extracts and standardizes data from four key FDD disclosure items:

• Item 5 and 6 — Fees: Initial franchise fee (the upfront licensing fee), ongoing royalty rates (typically a percentage of gross sales), and advertising or brand fund contributions. These recurring fees are the primary ongoing cost of franchise ownership beyond operating expenses.
• Item 7 — Initial Investment: Minimum and maximum total startup costs as estimated by the franchisor, including real estate or lease deposits, construction and buildout, equipment and signage, initial inventory, insurance, training travel expenses, and working capital reserves for the first months of operation.
• Item 19 — Financial Performance: Revenue, sales, or income representations where the franchisor chose to disclose them. Item 19 disclosure is voluntary under the FTC Franchise Rule — franchisors may choose not to include any financial performance data. When disclosed, figures may represent average revenue, median revenue, or revenue ranges for specific groups of franchised or company-owned units.
• Item 20 — Outlets: Total franchised units, company-owned units, units opened, units closed, units transferred, and terminated or non-renewed agreements over a three-year period. This data reveals the net growth trajectory and franchise system stability.

Processing Pipeline

1. FDD filings are collected from state registration databases (primarily California, Minnesota, and Wisconsin registrars, which maintain public FDD filing archives) and from franchisor public disclosures.
2. Key financial figures are extracted from FDD Items 5, 6, 7, 19, and 20 and entered into a structured data format with consistent field names and units.
3. Dollar amounts are standardized across franchise systems — converting ranges to minimum and maximum values, and normalizing royalty and ad fund percentages to a consistent decimal format.
4. Investment tiers are classified using the Item 7 total initial investment range: Low (under $100K), Mid ($100K–$500K), High ($500K–$1M), and Premium (over $1M).
5. Sector classification is assigned based on the franchise's primary business activity, using categories aligned with common franchise industry taxonomy.
6. All data is loaded into a structured SQLite database serving brand profiles, sector listings, investment tier filters, and comparison tools.

Data Currency and Update Frequency

Franchisors are required to update their FDD annually and file updated versions with state regulators (in registration states) by specific deadlines — typically 120 days after the end of the franchisor's fiscal year. Data on PlainFranchise reflects the FDD year listed on each brand profile. We update our database when new filings become publicly available from state registrar archives, replacing older data with current-year disclosures.

Accuracy Commitment

PlainFranchise reproduces FDD data exactly as disclosed by franchisors in their official filings. No subjective ratings, editorial opinions, or proprietary scoring formulas are applied. Investment tiers are calculated algorithmically from the Item 7 total investment range. When a franchisor does not disclose Item 19 financial performance data, this is displayed transparently rather than estimated or interpolated.

Limitations

• Item 19 financial performance data is voluntary — many franchisors choose not to disclose revenue or profitability figures, and those that do may present the data in ways that highlight favorable results.
• Revenue figures represent gross sales, not franchisee profit. Actual profitability depends on operating costs, lease terms, labor costs, geographic market, and individual management quality — none of which are captured in FDD data.
• FDD data reflects conditions at the time of filing, which may be 6–18 months before publication. Current market conditions, unit closures, or fee changes since filing are not reflected until the next annual update.
• PlainFranchise does not independently verify FDD data — all figures are as disclosed by franchisors under FTC and state regulatory requirements.
• This site does not constitute financial, legal, or investment advice. Consult a franchise attorney and accountant before making any franchise investment decision.

Contact

Questions about our methodology? Contact us.